Sinking Oil Prices Boost Stocks

The markets ended the last day of their choppy trading week solidly higher after traders cheered sliding crude prices and shrugged off concerns about the economic impact of the massive earthquake that slammed Japan.

Today's Markets

The Dow Jones Industrial Average was higher by 59.8 points, or 0.50%, to 12044, the S&P 500 was up 9.1 points, or 0.71%, to 1304 and the Nasdaq Composite was higher by 14.6 points, or 0.54%, to 2715. The FOX 50 increased by 4.5 points to 926.

Construction and engineering issues like KBR (KBR) and Fluor Corp. (FLR) led the charge higher on the belief re-building efforts in Japan would boost demand for building services. Energy companies like Hess (HES) and Peabody Energy (BTU) were strong performers as well.

Despite Friday's uptick, markets were largely lower on the week, with the blue chips sinking 1%. The tech-heavy Nasdaq fared worse, dropping 2.5% -- the biggest drop since August 2010 -- after the semiconductor sector was downgraded.

Oil prices, which have been a major component in driving equities markets in recent sessions, plummeted to as low as $99.01 as the "day of rage" protests in oil-giant Saudi Arabia were sporadic and mostly peaceful.

"There were built-in expectations of the maelstrom of discontent in Persian gulf" that didn't materialize, said Tom Kloza, chief oil analyst at the Oil Price Information Service.

Light, sweet crude slipped $1.54, or 1.5%, to $101.16 a barrel. The price consumers pay at the pump keeps creeping higher, with the average price for a gallon of regular hitting the $3.54 a gallon mark, up from $3.12 a week ago, according to the AAA Fuel Gauge Report.

Traders also mulled the potential economic impact of the 8.9 magnitude earthquake that slammed Japan, dealing a significant blow to the country, which is the third largest economy in the world.

The U.S. market "response [to the earthquake] will be more muted than anything else because it should not have an impact on our equity performance," said Peter Kenny, managing director at Knight Capital Group.

Several major Japanese companies, including Toyota (TM), Honda (HMC) and Sony (SNE), have had to temporarily close factories as a result of damage caused by the quake, according to media reports.

The earthquake can "upset the country's nascent economic recovery while exacerbating the country's ballooning public debt issues, as spending by the Tokyo government will surge to meet emergency response costs," according to a research report by IHS Global Insight.

The Japanese Nikkei tumbled 1.7% to its lowest level in five weeks, following the 8.9 magnitude earthquake that hit near Tokyo. The quake was the most powerful on record for Japan.

Shares of many global re-insurance companies, such as PartnerRe (PRE)and Everest Re (RE), which protect insurance companies against catastrophic liabilities, were lower amid concerns about how much exposure they have to the Japanese market.

On the economic front, retail sales jumped 1% in February after increasing 0.3% in January, according to the Commerce Department.The report was inline with economists' expectations.

Consumer confidence plunged to 68.2 in early-March from 77.5 in late-February, according to a Thomson Reuters/University of Michigan survey. Economists were expecting the index to inch lower to 76.

In currencies, the U.S. dollar sunk 1.3% against the Yen as traders expect Japanese to sell foreign assets to pay for emergency operations and clean-up, driving the value of the greenback vis-a-vis the Yen lower.

Gold was up $9.30, or 0.66%, to $1421 a troy ounce. However, gold slid 0.47% on the week, ending a five week winning streak.

Corporate Movers

American International Group (AIG) has offered to buy back its Maiden Lane II subprime bond portfolio for $15.7 billion from the New York Federal Reserve. The Fed initially bought the subprime assets in a bid to help prop-up the insurance giant in 2008.

99 Cents Only Stores (NDN) received an all-cash buyout offer of $1.36 billion from the Schiffer-Gold family and private-equity firm Leonard Green. Shares soared as much as 20% on the news that values that company at a 14.5% premium to its Thursday closing price.

Google (GOOG) is looking to hire 200 employees to support its YouTube video streaming service.

Aeroposatle (ARO) posted its fourth-quarter profits dropped 13% to 98 cents a share, narrowly missing analysts' estimates. Shares of the teen-clothing retailer were lower by more than 6%.

Aflac (AFL) shares were off as much as 2% on concerns about the insurer's presence in Japan.

Apple's (AAPL) second revision of its popular iPad goes on sale Friday.

Foreign Markets

Asian markets dipped after the earthquake in Japan.

The Japanese Nikkei 225 closed lower by 1.7% to 10,254 and the Chinese Hang Seng sold off by 1.6% to 23,249.

In Europe, the English FTSE100 was lower by 0.28% to 5,828, the French CAC 40 was off 0.89% to 3,928 and the German DAX slumped 1.2% to 6,981.